Best ETFs of the week: Energy, Banking, and Space ETFs

New highs for the S&P 500 and the NASDAQ composite

Last week two of the most famous indices, the S&P 500 and Nasdaq Composite, reached record highs. The S&P 500 index is composed of the 500 largest US compagnies by market capitalization, and the NASDAQ composite includes almost all companies listed on the Nasdaq stock exchange – often technology-related.

Several catalysts pushed the stock market to these new highs. President Biden announced on Thursday a new spending plan of $579 Billion in American infrastructure.

On Friday, the latest value of the Consumer Price Index (CPI) was released. This indicator which measures US inflation turned out quite high at 3.4% compared to the long-term objective of the Fed (the US Central Bank) of 2%. However, this number was in line with the consensus of Wall Street analysts. Therefore, the release calmed down fears of a sudden and prolonged increase in inflation.

Also, the market still prices in an improvement in US COVID rates and in the economy which helped carry indices further upwards.

Two sectors have significantly contributed to the rebound of the S&P 500 Index. The first is the Energy Sector which had poorly performed two weeks ago but rebounded strongly last week. Several analysts view this rebound as a technical catch up after a severe correction of the sector.

The second is the Banking Sector. Indeed, this sector has strongly benefited from a general increase in interest rates. Furthermore, the Fed is considering reducing the restrictions on dividend distributions. With banks usually paying large dividends, investors reacted positively to this announcement.

Top 10 ETFs of the Week: Energy ETFs, Banking ETFs, and Space ETFs

Europe:

• WisdomTree Natural Gas: +7,95%
• WisdomTree Nickel: +7,34%
• iShares Oil & Gas Exploration & Production ETF: +7,19%
• iShares Core S&P 500 UCITS ETF: +6,53%
• iShares S&P U.S. Banks ETF: +6,52%
• HANetf Procure Space ETF: +6,51%
• ZKB Palladium ETF AA: +6,24%
• Invesco Energy S&P US Select Sector ETF: +6,06%
• SPDR S&P U.S. Energy Select Sector ETF: +6,05%
• iShares S&P 500 Energy Sector ETF: +6,04%

Americas:

• First Trust ISE-Revere Natural Gas Index Fund: +10,78%
• VanEck Vectors Unconventional Oil & Gas ETF: +10,20%
• Invesco Dynamic Energy Exploration & Production ETF: +10,13%
• SPDR S&P Oil & Gas Exploration & Production ETF: +10,03%
• Ninepoint Energy Fund: +9,39%
• Invesco S&P SmallCap Energy ETF: +9,39%
• Invesco DWA Energy Momentum ETF: +9,22%
• Breakwave Dry Bulk Shipping ETF: +9,08%
• BMO Equal Weight U.S. Banks Index ETF: +8,88%
• United States Natural Gas Fund: +8,74%

Last week’s best performing ETFs are exposed to Natural Gas Commodities. They track the Bloomberg Natural Gas Subindex. ETFs tracking the US Energy sector also performed well. Energy commodities, especially Oil, were supported by the announcements of the new Iranian president. He refused any meeting and agreement with the American president. This information demonstrated clear tensions for the future around gas production, and this has pushed up prices. Driven by the rise in oil prices, other energy assets also performed well, propelling the whole sector to those top rankings.

After a fall two weeks ago, commodities (except oil) rebounded last week. In addition to Energy ETFs, some ETFs in the top track industrial metals – palladium and nickel. Palladium is an industrial metal used in electronic products and Nickel is a base metal and a chemical element used in different fields such as batteries, coatings, phones, jewelry, and medical equipment.

Finally, there is a thematic ETF amongst the best performing ETFs of last week. It is the first space-themed ETF available to European investors. It allows them to access to companies at the forefront of the space economy, such as satellite operators and hardware producers, as well as early entry into longer-term themes such as space tourism and hospitality. The theme of space is currently very trendy, with tourist space travels taking shape. Blue Origin, a company founded by Jeff Bezos, has scheduled its first tourist trip to space for July 20, 2021, and Mr. Bezos will be part of the adventure.

If you want to know more about Space ETFs, please continue the reading here.

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